Outlook for farm bill brightens after election

GOP may have been hoping for upper hand, analyst says

Nov. 11, 2012

John Thune

Written by

Christopher Doering

Kevin Scott

Tom Vilsack

WASHINGTON — The long race to Election Day ended with Washington looking pretty much the same as it did before voters went to the polls.

That status quo actually could be a good thing for farmers and ranchers in rural communities uneasy about congressional inaction on a new $500 billion farm bill.

After $6 billion was pumped into the election, President Obama still calls the White House home, Republicans still control the House and Democrats still hold power in the Senate. The same players should remain on the agriculture committees, too, with the top Democrats and Republicans back and expected to retain their respective posts in the next Congress.

Some lawmakers and agricultural policy experts say House Republican leaders were reluctant to bring the farm bill to a floor vote before the election because they hoped to gain a stronger foothold in Congress and take over the White House. That would have allowed them to pass a short-term extension of the current law before crafting their own five-year law in 2013.

Now, without that conservative shift, the thinking around Washington is that a farm bill has a better chance of passing before the end of the year.

The farm bill “was one of the things that was hanging in the balance with this election,” said Chad Hart, an associate professor of economics at Iowa State University. “When pressed up against that deadline, it’s a question of will a few votes — and it’s not going to take many — come out of the woodwork to say we need that compromise, and I think we (will) see that.”

Deadline misses
relatively common

The 2008 farm bill expired Sept. 30, but the real effect of not having a law in place will not be felt until next year. Failure to pass an extension or a new bill would cause farm policy to revert back to decades-old measures that would limit plantings and increase the price farmers receive from the government for commodities, potentially leading to more expensive products for consumers at the grocery store.

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It is not unusual for Congress to miss a farm bill deadline: the past three laws, 1996, 2002 and most recently in 2007, were finished a year later than expected.

Impasse in Congress over nutrition cuts

The Senate passed its five-year farm bill in June. A month later the House Agriculture Committee approved its version, but it contained deeper cuts to government nutrition programs than the Senate’s version, which siphoned off support for the bill from some Democrats. Meanwhile, additional backing was lost from Republicans who said $16 billion in proposed cuts was not enough.

As a result, the bill languished in the House, where GOP leaders were reluctant to call for a vote on that bill or the one passed by the Senate because they did not think they had the 218 votes necessary to pass either plan. But before the election, Majority Leader Eric Cantor, R-Va. said the farm bill would be brought to the House floor before the end of the year.

A spokesman for Speaker John Boehner, R-Ohio, said last week that that lawmakers will discuss the legislation when they return this week.

Election 'probably helpful,' Thune says

“With regard to the farm bill, (the election) is probably helpful to getting it passed,” said Sen. John Thune, a member of the Senate Agriculture Committee. “We’ve got to get this done, and I’m hoping this will give us some additional impetus to” finish it, he said.

One area where farmers expect to see continued support is renewable fuels. The White House, along with the U.S. Agriculture Department, led by former Iowa Gov. Tom Vilsack, have championed the use of ethanol and biodiesel. The agriculture community expects that support to continue during the next four years.

“Overall, there is not going to be a whole lot of change in the next few years,” said Kevin Scott, a soybean farmer from Valley Springs. “We kind of know what to expect from certain players, and you have your advocates in place, and you know where to go for certain items and you know what you can and cannot expect out of this Congress. It will be the same game plan that we’ve developed in the last four years.”

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But the lack of a significant change in Congress and the White House does not mean a smooth road ahead for agriculture. There is no guarantee a farm bill will be passed this year, and the odds are diminished by the heavy workload that awaits Congress when it returns.

Farm bill could get swallowed in talks

Vilsack and others are concerned that instead of acting on the farm bill separately, lawmakers will include it in a broader discussion in Congress and the White House over how to cut spending and deal with the country's $16 trillion debt. The fear is that agriculture could face deeper spending cuts if lumped with other programs.

Farmers and ranchers are watching to see whether an estate tax cut that expires at the end of the year will be renewed. Unless it is extended, the threshold at which the tax must be paid would drop at the same time the tax rate goes up. In South Dakota, more than 70 percent of the crop land would be effected by a change in the estate tax.

“It really will have a profound influence on decisions that get made about transferring the farm from one generation to the next,” said Trudy Wastweet, national policy adviser with the Iowa Farm Bureau Federation “That is something that keeps Iowa farmers up at night wondering what the tax code will be.”

Meanwhile, farm groups also said they will keep a close watch on possible new regulations from the administration. Rules for water, clean air, pesticides and farm dust have the potential to affect rural America.